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TMI Blog2009 (5) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... 32 dated 7-10-2003 and KASEZ 353 dated 9-10-2003" in the bills of entry, after the bills of entry had been noted by the customs on 13-3-2004. There is no dispute that goods found in the container were originally exported by the appellants. The Manager Shri G. Narayananswamy admitted that the above remarks were added after noting by the customs. 2. After completion of investigation and due adjudication process the goods imported were confiscated and allowed to be redeemed on payment of fine in lieu of confiscation of Rs. 25 Lakhs. Adjudicating authority also ordered the exported value of these goods not to be taken for considering the NFE. He also imposed penalty of Rs. 10 Lakh on M/s. Haria Exports Ltd. and Rs. 5 Lakh each on Shri Kantilal Haria, Director and Shri G. Narayananswamy and the penalty of Rs. 2.5 Lakhs on CHA. 3. M/s. Haria Exports, Shri G. Narayananswamy and Shri Kantilal Haria have filed appeals against the impugned order. 4. Heard both the sides. Ld. Adv. Shri J.C. Patel on behalf of appellants submitted that the appellants have nothing to gain by misdeclaration; there is no dispute that exported garments have been returned; the exports took place in Sep-Oct, 200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Oct., 2003 when the goods reached Dubai, the buyer in Dubai had informed the appellants that because of delayed supply the buyer refused to take delivery and therefore, the supplier had to take back goods. If this is so, he pointed out, the buyer in Dubai would not have made payment as late as in Feb. and in March, 2004. He also cited the decisions of Hon'ble Supreme Court in Om Prakash Bhatia reported in 2003 (155) E.L.T. 423 (S.C.) in support of his contention that non-declaration of country of origin would amount to violation of the law and therefore the goods are liable to confiscation. 5. We have considered the submissions from both the sides. Before we proceed further, the table of the transaction of exports and imports in this case is reproduced so that the facts become clear :- Particulars of Exports and Imports S. No. Shipping Bill No. & Date Export invoice No. & Date FOB Value in US $ FOB Value in Rs. B/E No. & Date Import invoice No. & Date C&F Value in US $ Assseble Value (Rs.) TP No. & Date 1 0041 10-9-03 K-34033 4-9-03 66240 3023866/- 5083 13-3-04 TIGT/KAN/73 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... suffice to say that the Revenue had made out a very strong case that the appellants have deliberately declared the country of origin wrongly and but for the investigation probably appellants would have shown these goods as imported. Ld. Adv. on behalf of appellants had cited the decision of the Tribunal in Suraj Diamonds (I) Ltd. reported in 2008 (227) E.L.T. 471 (Tri.-Mum.) in support of his contention that since it was held therein that when the goods are exempted from payment of duty no penalty is imposable. We find that the facts are different. In the above case the Chairman of the appellant-company had inspected the consignment and found that they were not diamond and worthless semi-precious stones and intimated the authorities that he had not contracted for import of these goods. In that case the appellant-company had no knowledge that these supplier had sent semi-precious stones instead of rough diamonds. In this case appellants were clearly aware of the nature of the goods they were importing and because of the investigation, the appellants apparently had to change track. Shri G. Narayananswamy had deliberately added the remarks in the bills of entry and the contention of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e viewed seriously inasmuch as they do not to gain anything from misdeclaring the country of origin. It also stands submitted before us that the goods were exported under three shipping bills without availing any export benefit like drawback, DEPB, DFRC or advance licences. It was further argued that even if value of such goods is not taken into consideration, they have already achieved positive NFE. It was also contended that the goods being admittedly re-imported and the export goods, the same were exempted in terms of provisions of customs Notification No. 94/96-Cus., dated 16-12-96 and as such there was no mala fide or any motive on their part to mis-declare country of origin of the goods. 8. The fact that the appellant had not earlier availed any export benefit at the time of export of the said goods, is neither being doubted by Revenue nor disputed. Further, it stand un-disputed on record that the appellants have already achieved sufficient and positive NFE even without taking disputed export into account. I also note that in terms of Notification No. 94/96-Cus., dated 16-12-96, the goods other than the goods exported under DEPB, EPCB or DECB and imported within a peri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d imported ready-made garments valued at Rs. 73,08,679/- and imposed redemption fine of Rs. 25,00,000.00 and penalty of Rs. 10,00,000.00 on the appellant-company and Rs. 5,00,000.00 on its Director and Rs. 2,50,000.00 on Authorized Signatory. He also disallowed export performance in respect of the confiscated goods against 3 shipping Bills. Ld. Member (T) rejected the appeals filed by the appellants. Ld. Member (J) reduced the redemption fine to Rs. 1 lakh and set aside the penalties on the appellants and upheld disallowing export performance in respect of confiscated goods for considering NFE of the Unit. 13. Ld. Advocate on behalf of the appellants submits that the appellant-company was engaged in the manufacture of ready-made garments, a Special Economic Zone unit. He submits that they had exported 3 consignments of ready-made garments in the month of September and October, 2003, which were returned back by the foreign buyer M/s. Tropical International General Trading LLC, Dubai for the reason delayed shipment and order was cancelled. He also submits that in the month of March, 2004, the appellant-company filed transhipment applications, which was duly assessed by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 (67) E.L.T. 25 (S.C.)] (b) M/s. Comex Co. v. CC, Madras-I [1997 (96) E.L.T. 526 (Mad.)]. 15. After hearing both the sides and on perusal of the orders of the ld. Members and the records of the case, it is seen that the Commissioner, in the impugned order observed that the appellant neither followed the procedure of re-import, as laid down in the Exim Policy at the relevant time nor taken any permission for the same from the Development Commissioner. It is further observed that this fact indicates the mala fide intention of the appellants to show these goods as fresh imports. It is also observed that the appellant misdeclared country of origin to show the goods as fresh import to keep their earlier export intact in order to achieve higher NFE. It is well settled that goods were misdeclared, liable for confiscation. Both the ld. Members also held that the goods are liable for confiscation. So, the case laws relied upon by the ld. D.R. on the proposition that mens rea is not essential for confiscation of goods, have no relevancy. 16. There is no dispute on the facts that the appellant exported the goods which were returned by the foreign buyer due to late shipment. Ld. Member (T) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... present case there is no revenue implication. Considering the facts and circumstances of case, in my view, penalty is not warranted and quantum of redemption fine as imposed by the Commissioner is excessive. But, the Third Member has no independent jurisdiction to fix the amount of fine and he has to subscribe view of one of the ld. Members. Hence, I concur with the findings of the ld. Member (J). Registry is directed to place the matter before the regular Bench for passing of appropriate order. (Order dictated and pronounced in the open Court on 9-2-2009) Sd/- (P.K. Das) Member (Judicial) FINAL ORDER In view of the majority order, the appeal of M/s. Haria Exports is partially allowed by reducing the redemption fine to Rs. 1 lakh (Rupees One Lakh only) and setting aside the entire penalty imposed upon the said appellant. However, the confiscated goods will not be considered while adjudging the export performance of the said appellant. The other two appeals of Shri Kantilal Haria and Shri G. Narayananswamy are allowed by setting aside the penalties imposed upon the said two appellants. (Pronounced in the Court on 29-5-2009) Sd/- Sd/- (B.S.V. Murthy) (Archana Wadhwa) Mem ..... X X X X Extracts X X X X X X X X Extracts X X X X
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